FOREWORD BY THE EXECUTIVE MAYOR OF THE CITY OF TSHWANE Inclusive growth is one of the prerequisites for rapid and sustained poverty reduction, as it allows the majority of a nation’s population to contribute to and benefit from economic growth. Robust development requires that a city directs its scarce resources efficiently, establishes an institutional environment that drives its developmental trajectory and creates an effective civil society network that demands the highest level of accountability and transparency. In this regard, a number of institutional elements within the South African economy require urgent attention. As such, this summit is charged with providing a platform on which to share ideas and inspire innovation for new and creative ways to address the challenges the Capital faces. It is my commitment to build a vibrant economic space so that we may generate investment in our City and in so doing rescue many South Africans from the throes of poverty and provide them with a better life - One with prospects and dignity. We have begun this task in earnest and we hope to accelerate and build on this progress. During our first one hundred days in office, we worked in earnest to steer this giant ship into a new course and we are proud of the significant strides we have made thus far in curbing corruption, delivering better services and being a responsive government. Our efforts to turn the “Tshwane ship” around are only just beginning, and the future of this metropolis, pregnant with vitality, is a bright one. Notwithstanding the challenges, our aim is to stabilise the city by overseeing the transition with delicate management. By incorporating critical stakeholders from the government sector, the private sector, academia, labour and civil society, the summit will provide a platform for information sharing between practitioners, researchers, communities and other parties of interest so as to collectively sculpt a strategy and plan that is anchored on the development of smart and sustainable inclusive growth choices for the City of Tshwane. Most significantly, this summit will result in the development of a joint action plan that will translate the City’s aspirations into reality, in a proactive attempt to arrest the prevailing low-growth, high-unemployment environment that characterises Tshwane’s economic landscape. The decisions arising from the summit will take us closer to repositioning the City and realising the transformation and development we seek, and steer us towards reintegrating the spatially, socially and economically divided city we have inherited. I conclude with a quote from our beloved former president, Nelson Mandela: “Overcoming poverty is not a gesture of charity. It is an act of justice. It is the protection of a fundamental human right, the right to dignity and a decent life. While poverty persists, there is no true freedom.” Cllr Solly Msimanga 1 | Mayoral Economic Summit 2017 REVITALISE. STABILISE. DELIVER. INTRODUCTION TO THE CITY OF TSHWANE INAUGURAL MAYORAL ECONOMIC SUMMIT 2017 “The only justifiable purpose for the existence of political institutions is to ensure the unhindered development of people in society.” (Albert Einstein) REVITALISE. STABILISE. DELIVER. At the beginning of the twentieth century, a mere sixteen cities, A robust developmental path for cities requires a city that is: (i) predominantly located in industrialised economies, were home able to direct its scarce resources efficiently, (ii) an institutional to a million people or more. Today, the antithesis to this once- environment that is able to drive its developmental trajectory and upon-a-time historic revolution is the fact that more than 400 (iii) an effective civil society network that demands the highest cities contain this number or more and are mainly located in level of accountability and transparency. In this regard, a number low and middle-income countries across the globe. Through the of institutional elements within the South African economy require enablement of agglomeration, large cities have helped transform urgent attention. economies for centuries. In comparison to non-urban settings, such instances are able to alter our social and economic fabric Two of the globe’s foremost development economists, Acemoglu at an exponentially higher frequency resulting in the creation of and Robinson argue that the key differentiator between countries the most vibrant markets for ideas that enable entrepreneurial and with respect to their historical and current growth trajectories is general business innovation. that of institutions. The authors argue that nations thrive when they develop inclusive political and economic institutions and they fail Asia and Africa are the regions that have not yet reached their when those institutions become extractive and concentrate power respective urbanisation tipping points and are projected to do so and opportunity in the hands of only a few (Why nations fail, 2012). by 2023 and 2030. Localising the picture indicates that Southern It is not surprising that this is a view supported by the majority of Africa will be 77per cent urban by 2050 whilst exhibiting a economists and social scientists across the world. current urbanisation rate of more than 60 percent. If leveraged appropriately, particularly by government and the private sector, Efficiently managing and optimising on today’s rapid transition urbanization has the potential to foster the highest levels of is critical towards ensuring sustainable growth. City leaders, inclusive growth leading to the necessary social change and and other critical stakeholders alike, are, ultimately, concerned positive political outcomes, amongst a plethora of additional with laying and enhancing the foundation of an environment benefits for all city residents. that perpetually enables the acceleration of inclusive growth collectively anchored by the highest level of visionary and Undoubtedly, inclusive growth is one of the prerequisites for pragmatic leadership. This must be optimally supported by the rapid and sustained poverty reduction as it allows the majority of creation of robust developmental partnerships that will propel us a nation’s population to contribute to and benefit from economic towards the City of Tshwane that we all collectively envision. growth. This concept refers to the pace, scale and patterns of growth and is often used interchangeably with a suite of terms, By convening critical stakeholders from the government sector, including broad-based growth, shared growth and pro-poor the private sector, academia, labour and civil society, the growth. The underlying ideology of inclusive growth concerns Summit will provide a platform for information sharing between increasing the pace of growth and enlarging the size of the practitioners, researchers, communities and other parties of economy whilst simultaneously leveling the playing field for interest to collectively sculpt a strategy and plan that is anchored investment and subsequently increasing productive employment on the development of smart and sustainable inclusive growth opportunities, which by its very nature results in a virtuous cycle. choices for the City of Tshwane. Most-significantly, the summit will result in the development of a joint action plan that will translate the As alluded to, over the next 30 years, most of the growth in the City’s aspirations into reality, in a pro-active attempt at arresting world’s population is expected to occur in the cities and towns of the prevailing low growth – high unemployment environment that poor countries. Indeed, by 2020, the globe’s developing world is characterizes the City of Tshwane’s economic landscape. likely to become more urban than rural. In this regard, the National Development Plan envisages that 11 million more people will inhabit Topics of discussion will be centered around the concepts of: South African cities by 2030 signaling a dynamic transformation • The inter-linkages between space and the economy; that will serve as a powerful force towards shaping the country’s • Core growth enablers, such as the provision of sustainable social, economic and political trajectory over the next decade economic infrastructure provision, including the innovative and indeed, in decades to come. The decisions that are made financing thereof; today will inherently shape our leaders of tomorrow inextricably • The growth potential of innovative city-level governance determining the collective fortunes of all South Africans into the solutions within the South African context; future. • Tshwane’s comparative advantage from a sector prioritisation perspective; A crucial consideration is that urbanization in today’s developed • Partnerships required for growth; and economies was gradual, taking place over a hundred years or • Social cohesion and growth. more thereby enabling greater learning and flexibility with respect to managing the urban transition. Today’s cities are growing at The summit’s host, the Executive Mayor of Tshwane, Councillor an unprecedented speed, facing sudden migration from rural Solly Msimanga, looks forward to your participation in sculpting and other areas. Cities that do not possess the requisite levels of the pursuit of our relentless and irrevocable journey of enhancing capacity and agility will be adversely affected further exacerbating the quality of life for all within Tshwane. the effects of unemployment, inequality and poverty. 2 | Mayoral Economic Summit 2017 REVITALISE. STABILISE. DELIVER.